FCA to consult on tougher rules for advisers

FCA to consult on tougher rules for advisers

The Financial Conduct Authority has said it will consult on the rules for the extended senior managers’ regime in the next three months.

From 2018 the regime, which currently applies to banks, will be extended to asset managers, financial advisers and stock brokers.

The senior managers regime focuses on individuals who hold key roles and responsibilities in relevant firms. It ensures that senior managers can be held accountable for any misconduct that falls within their areas of responsibilities

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In an update published today, the FCA said the extended regime would be “clear, simple and proportionate”.

It comes as rules affecting mortgage brokers and investment advisers at banks come into effect today, the certification regime, which applies to other staff who could pose a risk of significant harm to the firm or any of its customers.

A year since the senior managers regime was introduced to the banking sector, the regulator said it has seen firms take their responsibilities more seriously.

In a statement, the FCA said: “Since the regime was introduced, we have been undertaking work to ensure that senior manager responsibilities are properly allocated and understood in firms.

“In some cases, we have seen evidence of overlapping or unclear allocation of responsibilities.

“In other cases, firms appear to be sharing responsibility amongst some staff at different levels of management, obscuring who is genuinely responsible.

“However, we have also seen strong progress in relation to firms adopting a culture of individual accountability through their implementation of the regime.”

From today the rules on regulatory references for senior managers and staff in the certification regime come into force.

Today is also the deadline for firms to have issued certificates for staff in the certification regime.